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Software Company SAP’s Stock Hits Record High On Strong Earnings
Europe’s biggest software company announced earnings per share of €1.23 (US$1.33), which beat the consensus expectation of analysts that had called for $1.32 U.S.
Revenue in the quarter rose 9% year-over-year to €8.47 billion.
The company attributed the positive results to its cloud computing segment, where revenue grew by 25% in this year’s third quarter.
On an earnings call with analysts and media, management said that customers are shifting to the cloud, where it provides artificial intelligence (A.I.) business services.
In terms of forward guidance, SAP said that it expects to generate between €29.5 billion and €29.8 billion in cloud and software revenue for the full year, raising the midpoint by €400 million.
The company also raised its outlook for free cash flow, which is now seen at €3.5 billion to €4 billion, up from about €3.5 billion previously.
SAP’s guidance for its 2024 cloud revenue is unchanged at €17 billion to €17.3 billion.
The stock of SAP rose as much as 4% immediately after the Q3 financial results were made public, pushing the share price up to an all-time high of $235.76 U.S. per share in New York.
SAP’s stock has now risen 74% in the last 12 months.
